LUCIA MUTIKANI, Johannesburg | Tuesday
SOUTH African new vehicle sales will exceed expectations of 15% growth during 2000, laying the base for further expansion of up to 10% in 2001, manufacturers said this week.
Sales volumes shrunk eight percent in 1999, knocked by the lingering effects of the 1998 emerging markets crisis which saw domestic interest rates hiked to a decade high of 25.5%.
A gradual decline in commercial lending rates to 14.5% now has stimulated demand for vehicles, with sales volumes showing a steady increase since January this year.
”Following an improvement in new vehicle sales volumes in 2000 in excess of 15%, projections for 2001 indicated an expected improvement in aggregate sales in the rand of 7.5% to 10%,” said the National Association of Automobile Manufacturers of South Africa (Naamsa).
New vehicles sales are one of the leading indicators of economic growth.
”Sales are running ahead of that expectation at present with year-on-year growth of 16.6%. The industry will have a healthy base on which to build further in 2001,” said Johan van Zyl, Toyota South Africa’s marketing director.
Similar sentiments were echoed by Brand Pretorius, chief executive of McCarthy Motor Holdings, South Africa’s largest vehicle retailer.
”I expect reported total vehicle sales for the full calendar year to show an increase of more than 15% over sales reported in 1999,” Pretorius said.
New vehicle sales accelerated 17.8% year-on-year in November to 28 827 vehicles, buoyed mainly by the inclusion of Volvo, Renault and the new Condor model from Toyota.
Commercial vehicle sales continued to power ahead amid signs of a pick up in economic activity, government purchases and an upsurge in buying from the agricultural sector.
”A good December can be expected due to good stock availability, aggressive trading by some manufacturers and dealers and some pre-price increases,” said Pretorius.
Vehicle prices are expected to increase in January due to the continued depreciation of the rand against the currencies of the major countries supplying automotive components and vehicle imports.
The rand has lost around 14.8% of its value of against the Japanese yen and about 9.5% on the euro. – Reuters